As part of a trading update by parent company National Australia Bank Group Clydesdale said it and sister operation Yorkshire Bank expect to fulfill the commitment to new lending announced in October 2009.

This will see £10 billion advanced to business customers and mortgages by October this year.

NAB's UK operation was "sound and resilient" despite operating in a difficult economy however subdued demand for credit and low interest rates were restricting income growth.

There was a slight increase in distressed assets from 3.15 per cent to 3.34 per cent.

The bank predicted a slow recovery from the UK due to spending cuts and uncertainty in the Euro-zone.